Intellectual property law is good. Excess in intellectual property law is not. This blog is about excess in Canadian and international copyright law, trademarks law and patent law. I practice IP law with Macera & Jarzyna, LLP in Ottawa, Canada. I've also been in government and academe. My views are purely personal and don't necessarily reflect those of my firm or any of its clients. Nothing on this blog should be taken as legal advice.

Sunday, December 16, 2012

High Voltage and High Stakes: Voltage Pictures Seeks Disclosure of Customers' Names and Addresses from Teksavvy

There have been many recent reports (e.g. here,
here,
here,
here
and here)
about Voltage Pictures’ second attempt at mass copyright litigation in Canada
and its motion to force Teksavvy, an innovative and independent Chatham, Ontario
based ISP known for its consumer friendly advocacy, to disclose the names and
addresses of 2,000 of its subscribers who are currently identified only by IP
address. These subscribers have allegedly infringed Voltage’s alleged copyrights
in certain listed cinematographic works, such as“Balls to the Wall.”Interestingly, theStatement
of Claim does not refer to “Hurt Locker”, a Voltage picture that was the
subject of a
2011 mass litigation effort, also in the Federal Court, against customers of
some Quebec ISPs. That actionwas
discontinued on March 28, 2012.

If the motion remains unopposed and is granted,
the result could immediately affect 2,000 Teksavvy customers and help to pave
the way for future mass litigation - or the threat thereof in order to obtain
vast numbers of “settlements” - in
Canada in the future. Such litigation
would be new to Canada.

I have no involvement at this time in this
litigation. That said, I should disclose that I was lead counsel for CIPPIC
back in 2004 and 2005 whenCIPPIC
actively intervenedin the BMG litigation in support of the public
interest and to assist the Court with respect to copyright and privacy
issues. At that time, certain major record
companies were targeting only 29 alleged infringers spread amongst five large
ISPs. Now we have one plaintiff (Voltage Pictures) suing 2,000 subscribers of
one small Canadian ISP, namely Teksavvy.
It should be emphasized that none of those objecting to or intervening
in the motion in 2004 were there in support of what is sometimes called “piracy” by the alleged downloaders and
file sharers. The battle was all about privacy
– and when it can or should be breached, mindful among other things of the
severe consequences of ordinary citizens being dragged into complex and costly
litigation, quite possibly by mistake based upon unreliable information.

Although Teksavvy has indicated that it “will not provide personal information to
a 3rd party when copyright infringement is alleged unless ordered to do so by a
court”, it has, however, decided in the end not
to oppose the motion seeking such an order. It has decided not to cross-examine
on Voltage’s affidavit material and not to file any written material. In a
recent blog post entitled “Why we are not opposing motion on Monday”,
Teksavvy’s CEO explains why his company has taken this position:

Everybody
should know though that we have looked into all angles to determine what our
position should be in this situation and after spending a significant amount of
time and soliciting a considerable amount of advice from numerous respected
sources, we found that we simply could not comment on the merits of the case.
Our place is to ensure that we provide adequate notice and also to make known
to others that these requests have occurred and that the best way to make sure
to avoid being involved is to simply not engage in such activities. If somehow
you end up involved and you feel its not right, the place to voice your concern
is the hearing on Monday. If you intend to appear, please let us know also.

I will be there on Monday to ensure your
privacy is taken seriously however we will not be making a case against the
merit of what they are alleging. That's for those affected and others to do if
they wish to. Our role has been to provide notice and to take every step to
alert and to some degree educate people that the laws have now changed and
apparently so too have the technologies used to collect evidence in these
cases. If they were not enforcing these laws in the past, they are certainly
doing so now, whether the laws are right or not is not for us to judge.

2.Be notified that a request for their personal information has been made
by a third party.

3.Have an opportunity to defend themselves when claims are made against
them.

TekSavvy will do everything in its power to protect its customers.
However, we must comply with all court orders requiring us to disclose the
personal information of our customers.

Despite Teksavvy’s openness concerning this issue,
questions are still bound to arise why Teksavvy is not actually opposing this
disclosure motion in 2012, as Shaw and Telus actively and successfully did in
2004, with Bell and Rogers taking a similar if less vigorous position. In this
regard, it is interesting to compare Voltage’s
material with the
BMG et al material filed in 2004 that was rejected by the Federal Court and
Federal Court of Appeal at that time as inadequate in a very comparable
situation, as a result of which we now haveclear
and binding appellate case law.

Teksavvy did go to some length to specifically
notify its potentially affected customers. However, it would be very surprising
if any of them are willing and able to retain counsel to assume the burden of
opposing a determined and experienced plaintiff and to assume the risk of an
adverse costs award. In any event, the lack of time probably renders the
possibility of such activity by individual Teksavvy subscribers effectively completely
hypothetical.

According to
CIPPIC, this is not “bona fide” litigation. In CIPPIC’s words, “this plaintiff has a track record in the United States of
demanding subscriber data of internet service providers for the purposes of
demanding exorbitant payments to settle under threat of litigation, with no bona fide intent
to prosecute such litigation”

According to CIPPIC, there is heavy reliance by Voltage on “hearsay” evidence. In CIPPIC’s words, “even a generous reading of the applicant’s motion materials discloses abundant reliance on hearsay evidence, including the key paragraphs in Mr. Logan’s affidavit describing the gathering of the evidence of infringement (paras. 10-11, at page 10 of the Applicant’s Motion record).”

According to CIPPIC, “it is worth noting that the plaintiff has pleaded that the John and Jane Does have engaged in commercial infringement. We suggest that even a generous reading of the applicant’s materials fail to make our even a bona fide case of commercial infringement.”

According to CIPPIC, the Statement of Claim also raises questions regarding jurisdiction issues in relation to non-statutory claims; and the question of joinder.

If CIPPIC is substantially right about the issues
it raises in its letter of December 14, 2012, it might have been quite feasible
for Teksavvy to successfully oppose the motion seeking to force it disclose its
subscribers’ identity, as was done in 2004.

The law about all of this was clearly
laid out by the Federal Court of Appeal in 2005. Here is a very balanced discussion of this presented by myself and one of my
worthy opponents in that case, Richard Naiberg. The key criteria for potential success in a
disclosure motion such as this is that there must be substantial, admissible, non-hearsay, and reliable evidence in
the form of affidavit
material and at least a bona fide
case.

The disclosure motion will be heard in the Federal
Court in Toronto at 180 Queen Street West at 9:30 AM or possibly not long
thereafter on Monday, December 17, 2012. The hearing will presumably be open to
the public, although these court rooms typically have very limited seating for
spectators.

HPK

PS - The Federal Court apparently took note of CIPPIC's letter and a request by Teksavvy to adjourn was granted until January 14, 2013. It will be interesting to see if Teksavvy now decides to actually oppose and if CIPPIC is permitted to intervene, and if so on what terms. See Michael's update.